Fwd: Hindustan Zinc Q2FY12 Result Update; Weak INR to offset low LME; Lead biz need to catch up; Buy; Target: Rs 159

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Deepak Vaishnav

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Oct 22, 2011, 4:09:25 AM10/22/11
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Hindustan Zinc

Weak INR to offset low LME; Lead biz need to catch up

 

BUY

 

CMP: Rs 121                                       Target Price: Rs 159

n     Revenue at Rs 26.4 bn up 19.8% on YoY basis, but down 7% QoQ due to marginal decline in refined zinc and lead sales, lower LMEs QoQ and no concentrate sales

n     EBITDA at Rs 14.7 bn was up 30% YoY while down 8% QoQ. EBITDA margin stood at 55.6% up 443 bps YoY basis but down 38 bp QoQ basis. Zinc CoP fell to US$847/ tonne

n     APAT at Rs 13.7 bn, broadly in line with revised estimates was up 42% YoY.  The shortfall on account of lower lead sales was offset by higher other income Rs 3.9 bn (up 110%)  

n     We refine our FY12E and FY13E assumptions on account of LME, Exchange rate and volumes. Due to global sentiment lowered target to Rs 159 (6xFY13 EV/ EBITDA); Retain Buy   

 

Regards,

Jagdish Agarwal

Senior Research Analyst | Emkay Global Financial Services Ltd. | www.emkayglobal.com | Email : jagdish...@emkayglobal.com 

Board No. : +91-22-66121212 | Extn. : 381 | DID : 66121381 | Mob : +919820869499 |

 

Goutam Chakraborty

Research Analyst | Emkay Global Financial Services Ltd. | www.emkayglobal.com| | Email : goutam.ch...@emkayglobal.com 

Board No. +91-22-66121212 | Extn. 275 | DID : 66121275 | Mob No. : +919867361765 |

 

 


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Hindustan Zinc Q2FY12 Result Update.pdf
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